0

Growth Investing in American Express Stock

PUBLISHED Aug 27, 2022, 6:40:00 PM        SHARE

img

Growth Investing in American Express Stock

American Express Company is a payment card services provider with world-class products and services. The company has thrived over the years by providing excellent access to products, insights and experiences for their customers.

Its customers include consumers, small-businesses and mid-size companies. The company has mastered the art of marketing and wide distribution of its products globally to reach a wide audience by utilizing online marketing, direct-response advertising, and customer referral programs, among others. The company maintains a relationship with third party banks and financial institutions.

Overview of American Express Progress

At the beginning of the corona virus pandemic, American Express suffered a huge setback. The pandemic brought travel and most businesses to a halt, which had a tremendous impact on using American Express cards. The company struggled at the beginning of the pandemic, as revenue declines. However, it pressingly remained profitable throughout.

In quarter 1 2022, American Express sales jumped by 29% from the previous year’s first quarter. The revenue was $11.8 billion, which completely made up for the losses suffered during the pandemic. The revenue was attributed to increased card member spending which was particularly high in March. American Express management expressed a revenue goal of 20% for 2022.

The company greatly invests in assessing the most effective ways of engaging its customers and business in both adverse and friendly business climates. According to C.E.O Stephen Squeri, American Express has invested in key areas to capitalize on long-term growth.

These include; acquiring customers, engaging them and working to retain them. The company is particularly targeting a younger demographic of customers who are more tech savvy and shop more. If the company can attract this group of consumers and maintain a high retention rate, it goes without saying that the immense profits and growth will be expected in years to come.

Also read Will Appian Stock Go Up?

American Express Growth Grade

When we think of growth investing, its mostly on the notion that stocks of companies with prolonged growth perform better than slow-growth companies. However, there are several factors that come into play when categorizing high-growth stocks.

They include; year-over-year, increased sales and revenue which historically, contribute significantly contributed to long-term growth. If a company can grow sales, earnings per share and operating cash annually over five years, it can be considered a high-growth company. American Express has a growth score of 55.

The company boasts of sustained revenue growth, innovation and digital solutions which place it at a good position for growth. Additionally, the company often engages in acquisitions.

Over the last four quarters, American Express has surpassed the financial outlook estimates, with an average of 33.27%. American Express return on equity stands at 33.4% for the trailing 12 months, against the industry average of 22.6%. This shows that the company’s management is competent in wisely investing shareholders’ funds for profits.

American Express Outlook

The company will continue benefitting from growth initiatives such as launching new products and upgrading existing products. It also plans to extend its collaboration efforts with established organizations to boost its capability.

Gradually, the economy is expected to recover, which would see an increase in American Express revenue as consumer spending increases. The company expects to achieve a revenue growth of over 10% in the long haul.

The main strategy utilized is to attract premium consumers by offering membership benefits. The benefits include; meeting the daily expenses, borrowing and travel needs of these consumers. The strategy not only meets the customers’ needs but also increases the presence of American Express in the market.

The company also launches highly innovative products and features which come as card offerings. The offerings contain financing, banking and payment solutions.

In the current digital marketing space, a company must keep up with the fast-paced environment of dynamic digital trends. The company works to improve digital features and services by collaborating with the best companies in the game.

Why Buy American Express?

American Express cash balance has been consistently going up, thus creating a strong balance sheet. According to its 2021 financial report, the company can comfortably offset short-term debt. The company is committed to undertake debt repayment programs to enjoy the decline in interest rates.

Additionally, the company is capable of generating cash to invest in business. Share buybacks and dividend payments are some of the ways the company tactfully deploys capital. The company has an incredible record of cheap valuation. Therefore, now is the best time to buy American Express, long.

AXP, Buy

American Express...
Return: 46.11%

AXP, Buy

Return: 46.11%


Sound investments
don't happen alone

Find your crew, build teams, compete in VS MODE, and identify investment trends in our evergrowing investment ecosystem. You aren't on an island anymore, and our community is here to help you make informed decisions in a complex world.

More Reads
Will Student Debt Forgiveness Affect the Economy?
Image

College Grads Have More Cash, but Will it Spike Inflation?

What Will Microsoft Stock Be Worth in 10 Years?
Image

Microsoft stock has rewarded its shareholders with more than 700% return over the past ten years. It will continue to grow over the next decade as well.

Jackson Hole and More
Image

Ahead of the much-anticipated speech by Federal Reserve Chair Powell, the Fed funds futures are pricing in about a 70% chance of a 75 bp hike next month.

The Best Oil Refiner: Analyzing The Big 4 U.S. Oil Refiner Stocks
Image

Oil refiners have enjoyed an impressive rally since the start of 2021, thanks to the recovery of global consumption of oil products from the pandemic.

Recent Stock Purchase August 2022
Image

How has your summer been going? For me, it is more of the same which simply means making a monthly stock purchase and staying invested no matter how ugly the world economy is looking.

ETH 2.0: Here is Everything you need to know.
Image

Find out all there is to know about the upcoming Ethereum network upgrade, ETH 2.0, right here! Including what it is, and what upgrades are coming.

Dollar Longs Pared as Jackson Hole Gathering is set to Start
Image

It seems that many market participants had the same thing in mind, cut dollar longs before the Jackson Hole gathering.

Top 5 Foundation Dividend Stocks for ANY Portfolio [October 2020 Update]
Image

Hey everyone! I was sitting at my kitchen table doing an intense round of push-ups, reading articles and had a thought. I would love to share my point of view on the top 5 foundation dividend stocks that every beginning investor should own.

eBay (EBAY) Stock – A Possible Discounted Stock to Bid On?! | Investing for Passive Income
Image

Let’s dive into a selling and re-selling platform that I use almost every single day. We are talking about eBay, not Amazon nor Facebook. I have used eBay as a reselling platform for more than 10 years.

Is Investing with Robinhood REALLY a good Idea ?
Image

Robinhood has a simple user interface that makes trading and investing with it quite a pleasant experience, and while it used to be the "Go to Choice" for new investors, recent events have caused many investors to reconsider the platform's trustworthiness.

A Statistical Appraisal Of Bond And Equity Behaviour
Image

Bonds and equities exhibit fundamentally different patterns

The Perfectly Imperfect Investor
Image

The Perfect Investor allocates their portfolio to 100% stocks when the market is at a local bottom. And they allocate to 100% bonds (or perhaps cash, to be even more conservative) when the market is at a local top.

Surging Energy Prices Pushing Europe Closer to Recession
Image

The poor eurozone PMI underscores likely recession and weighs on the single currency, which was sold to a new 20-year low.

Chevron (CVX) – Oil and Gas Demise Is Overblown
Image

This Chevron Corporation (CVX) post is my third in a series of posts in which I cover an integrated oil and gas producer as well as summarize the overblown expectations of the demise of the oil and gas industry.

SCHD vs. VYM: Which Dividend ETF Is The Best?
Image

SCHD and VYM are the two best dividend ETFs on the market. They provide a yield of around 3% and have a low cost of ownership. There is plenty of diversification in each fund, but each is designed differently.

Stock Buybacks - Everything You Need to Know
Image

A stock buyback is a tool companies can use to add value for their investors. Stock buybacks can be publicly controversial when the buyback was made only to make a company's numbers better

How to Recession Proof Your Money
Image

Many people are worried about the looming recession. Here’s some information that may help ease your fears.

Oddest Collectibles to Invest in 2022
Image

When it comes to investment strategies, there is no single prescribed way to maximize your returns. While most investors choose to put their money into stocks, bonds, or real estate, they are not the only options out there.

Blue Chip Stocks In Focus: Atmos Energy
Image

Atmos Energy can trace its beginnings back to 1906, when it was formed in Texas. Since then, it has grown organically and through mergers to a $16.5 billion market capitalization.

Blue Chip Stocks In Focus: Bristol-Myers Squibb
Image

Bristol-Myers Squibb was created as the result of a merger between Bristol-Myers and Squibb on October 4th, 1989. Bristol-Myers can trace its corporate beginnings back to 1887.

Resources for Publishers
Resources for New Investors
Boosted with BossCoin